Nissan downbeat on year ahead as it posts record sales

Nissan has posted record net profits thanks to tax breaks in the US but underlying earnings fell as the Japanese car giant ran into a series of problems.The collapse in car sales in the UK compounded by confusion over diesel - which Nissan has warned will mean hundreds of layoffs at its giant Sunderland plant - hit performance in Europe, the company said as it posted annual numbers.Nissan also faced costs from having to recall a million cars following a scandal were it was revealed they were inspected by unqualified staff in its Japanese factories, as well as pricing pressure and poor sales for the first three quarters of the year.A record 5.77 million vehicles were sold by Nissan during the year to the end of March, driving up revenues by 2pc to 11.9 trillion yen (?80.3bn). However, the troubles meant operating profit was 22pc lower at 574.8bn yen and the operating margin fell 1.5 percentage points to 4.8pc.

Nissan has warned of job cuts at its Sunderland plant

Credit:GettyAs well as US tax changes, the weaker yen gave net profit a boost, which was 12.pc higher, at 746.9bn yen, as foreign sales inflated profits when they were translated into yen.The car maker also gave a downbeat forecast for the coming year, predicting operating profit would be 540bn yen, some 75bn yen below automotive analysts’ consensus forecast - even though Nissan expects to sell 5.9m vehicles in 2018, helped by new model launches.

Credit:BloombergNissan is also in talks with its partner company Renault about how they can better combine their resources to deal with costs related to new technology such as driverless cars and electric power systems.The two companies have worked as an alliance for two decades in an arrangement that has delivered savings of up to €5bn a year.In March it was reported they could fully merge to make even bigger savings, though even Hiroto Saikawa, chief executive of Nissan, last month told Japanese media he saw ”no merit” in combining the whole companies, warning that such a tie-up would have “side effects”.

The use of any materials placed on the site is allowed on condition of giving the link to our site.

When copying materials for Internet publications, a direct open hyperlink for search engines must be given. The link should be placed regardless of full or partial use of our siteпїЅs materials. Hyperlink (for Internet publications) must be placed in the subtitle or in the first paragraph of the material.